Kenya to set up sovereign wealth and infrastructure funds, president says

Kenya to Launch Sovereign Wealth and Infrastructure Funds, President Announces
The government of Kenya has moved to establish two major investment vehicles — an infrastructure fund and a sovereign wealth fund — as part of its strategy to channel capital into key sectors without relying solely on new borrowing, President William Ruto announced on October 6, 2025.
The infrastructure fund will target sectors such as agriculture and power generation, while the sovereign wealth fund is intended to serve future-generation investments.
Kenya’s move comes against a backdrop of heavy debt burdens and high debt-service-to-revenue ratios that have constrained fiscal space.
A new privatisation law has been cleared by Parliament, allowing the sale of state assets to generate seed capital for these funds. President Ruto cited the planned share offer of the Kenya Pipeline Company as the first such asset sale: it could raise up to KSh 130 billion (about US$1.01 billion) to kick-start the funds’ operations.
The infrastructure fund will first focus on boosting crop production for export and increasing Kenya’s electricity generation capacity — currently around 2,300 MW — to the government’s industrialisation target of at least 10,000 MW.
Reactions within Kenya and among analysts are mixed. Supporters say the dual-fund approach signals a forward-looking fiscal strategy that moves away from debt-financed infrastructure expansion and empowers domestic investment. Critics caution that creating sovereign wealth funds without a clear revenue stream or strong governance may risk spinning off into under-utilised vehicles.
Implementation details remain thin, and market watchers will be monitoring the monetisation of assets and how the funds are governed.
Looking ahead, the success of Kenya’s initiative will depend heavily on timely asset sales, transparent management, clear mandates for each fund, and the government’s ability to resist using the funds for short-term budget relief. If executed well, the infrastructure fund may accelerate Kenya’s push into industrialisation and agricultural exports, while the sovereign wealth fund could help save for future generations. Conversely, lacklustre execution or weak oversight may undermine trust and derail the long-term potential of the vehicles.